Coffee prices in New York approach all-time high

NEW YORK, Sept 17 (Reuters): Prices for coffee futures traded in the Intercontinental Exchange in New York approached an all-time high on Tuesday as the market continues to climb amid the US tariffs and a dry September in Brazil, which could hurt production.

Arabica coffee futures earlier rose to a session high of $4.24 per pound, a seven-month top and not far from the all-time peak of $4.29 per pound for the most liquid contract hit earlier this year.

The futures fell towards the end of the session with investors booking profits. Arabica closed down 2 per cent at $4.0935/lb.

Coffee is one of the items that are keeping food prices in the United States persistently high. The Federal Reserve is meeting Tuesday and Wednesday to decide a potential rate cut, depending on their evaluation of inflation data, among other factors.

Prices for arabica coffee, the mild variety mostly used by coffee chains such as Starbucks and Dunkin Donuts, have jumped around 50 per cent at ICE since the Trump administration applied a 50 per cent tariff on Brazilian imports at the end of July, including green coffee.

Roasted coffee prices at grocery stores in the US rose 20.9 per cent in August from a year ago, according to Bureau of Labor Statistics data.

The South American country used to supply a third of all the coffee used in the US, but shipments dried up since the tariffs, rushing local roasters to grab available supplies, including certified stocks at the exchange.